Abbott Landscaping purchased a tractor at a cost of $42,000 and sold it three years later for $21,600. Abbott recorded depreciation using the straight-line method, a five-year service life, and a $3,000 residual value. Tractors are included in the Equipment account. Required:1. Record the sale.2. Assume the tractor was sold for $13,600 instead of $21,600. Record the sale of equipment.

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Explanation:

An asset's book value is $21,600, on January 1, Year 6. The assets is being depreciated $300 per month using the straight-line method. Assuming the asset is sold on July 1, year 7 for $14,200, the company should record:

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